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© Reuters. The price target for Coinbase stock was raised as the analyst expects robust Bitcoin ETF inflows
Analysts at JMP Securities increased their price target on Coinbase (NASDAQ:) to $300 from $200, citing expectations of strong inflows into spot Bitcoin exchange-traded funds (ETFs).
“We estimate $220 billion will flow into spot Bitcoin ETFs over the next three years, multiples of what has already been experienced; If we are right, Coinbase remains well positioned,” the analysts wrote in the note.
Analysts maintained a Market Outperform rating on the stock.
JMP analysts first expressed their bullish view on the impact of a potential spot Bitcoin ETF on the crypto market and Coinbase’s role in it in December 2023.
Contrary to the prevailing assumption that such an ETF would negatively impact exchanges like COIN, they expected the opposite effect. Notably, JMP believed this view was incorrect and overlooked the crypto exchange’s unique position and evolving business model in the broader crypto ecosystem.
Additionally, analysts and their team believe that current activity and inflows into Bitcoin ETFs are likely just “the tip of the iceberg.”
“We expect inflows to actually continue to increase significantly over the next few years, having reached about $10 billion so far two months after launch, as ETF approval is just the beginning of a longer capital allocation process,” as the analysts wrote,
With that in mind, the broker sees Coinbase and a handful of its competitors as “significant beneficiaries of the additional capital flows” expected to enter the space.
With few companies having the technical expertise and scale needed to help others enter and succeed in the digital assets space, JMP analysts see Coinbase “currently well-positioned to participate in many growth areas of an industry of which we estimate it will grow many times over the next decade.”
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